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Keryx's (KERX) Loss Wider Than Expected in Q2, Sales Lag

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Keryx's (KERX) Loss Wider Than Expected in Q2, Sales Lag

Keryx (KERX) posts wider-than-expected loss in Q2. Moreover, revenues miss the mark.

Keryx Biopharmaceuticals, Inc. KERX incurred a loss of 18 cents per share in the second quarter of 2018, wider than Zacks Consensus Estimate of a loss of 14 cents. The loss was however, narrower than the year-ago loss of 21 cents.

Revenues came in at $25.7 million in the reported quarter, missing the Zacks Consensus Estimate of $26.63 million but surpassing the prior-year figure of $15.1 million.

Keryx’s top line comprises revenues generated by its only marketed product Auryxia (ferric citrate). The drug is already approved in the United States to control serum phosphorus levels in adults with chronic kidney disease (CKD) on dialysis. In September 2015, Keryx gained an EU approval for Fexeric (EU trade name for Auryxia) for the control of elevated serum phosphorus levels or hyperphosphatemia in adult patients with CKD including dialysis and non-dialysis dependent CKD. In November 2017, the FDA granted an approval for an additional indication of Auryxia to treat adults with iron deficiency anemia (IDA) as well as chronic kidney disease, not on dialysis. The approval is boosting the company’s sales, given the IDA market’s great potential.

Shares of the company were down almost 5.26% on Wednesday following its earnings release. The stock has lost 18.7% year to date, underperforming the industry’s decline of 4.6%

Quarter in Detail

Auryxia’s net product sales in the United States totaled $24.1 million, up 70.9% from $14.1 million in the prior-year quarter. This increase was a result of more CKD patients with hyperphosphatemia and iron deficiency anemia, who were being treated with Auryxia. As a result, demand for Auryxia prescription and tablet rose sharply.

Auryxia’s prescription increased to 42,500 in the quarter under review, representing 8.4 million Auryxia tablets compared with about 21,100 prescriptions and 4.5 million Auryxia tablets in the second quarter of 2017.

During the quarter under consideration, more than 2000 additional physicians prescribed Auryxia compared with what was prescribed in the comparable quarter last year.

Keryx recorded license revenues of $1.6 million during the second quarter, up 60% year over year.

Research and development expenses dipped 2.2% to $8.8 million in the quarter concerned from $9 million in the previous year.

Selling, general and administrative expenses were $28.7 million in the second quarter, up 14.8% from the year-earlier period’s figure of $25 million, primarily owing to higher non-cash stock compensation expense.

In June, Keryx signed a definitive merger agreement with Akebia Therapeutics AKBA to combine in an all-stock consideration. The deal is expected to close by the end of 2018, subject to shareholder’s approval and customary closing conditions. The merger is intended to create a fully integrated renal company with a complementary portfolio, comprising Keryx’s Auryxia and Akebia’s product candidate, Vadadustat.

Keryx Biopharmaceuticals, Inc. Price, Consensus and EPS Surprise

Keryx Biopharmaceuticals, Inc. Price, Consensus and EPS Surprise | Keryx Biopharmaceuticals, Inc. Quote

Zacks Rank & Stocks to Consider

Keryx carries a Zacks Rank #4 (Sell).

Two better-ranked stocks in the healthcare sector are Gilead Sciences, Inc. GILD and Illumina, Inc. ILMN, both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Gilead Sciences’ earnings estimates have been moved 7.7% north for 2018 and 2.2% for 2019 over the past 60 days. The stock has gained 7.3% year to date.

Illumina’s earnings estimates have been revised 11% upward for 2018 and 8% for 2019 over the past 60 days. The stock has soared 54.7% so far this year.

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